Government tasks UEGCL to ensure cheaper power

KAMPALA. Under pressure to increase access to power, government has tasked Uganda Electricity generation Company Limited (UEGCL) to produce affordable electricity.

Findings from the National Population and Housing Census 2014 undertaken by the Uganda Bureau of Statistics (Ubos), show that about 20 per cent of households in the country use electricity as their main source of energy for lightning.
Although electricity use has more than doubled and use of Tadooba (local paraffin candle) has reduced by about 20 per cent, the biggest segment of the population cannot access power because the cost is high.

Uganda Manufacturers’ Association leadership is equally concerned about the high cost of power, saying it increases the cost of doing business, thereby rendering them uncompetitive.

Speaking at the launch of the ISO certification of Uganda Electricity Generation Company Limited (UEGCL), the first government agency to achieve such a feat, Energy minister Irene Muloni said the government’s target is to see generation increase its capacity from the current 825MW to about 2500MW by 2020.

To achieve the target, she said: “The next stage is for us to manage the generation facilities under our jurisdiction. This is because electricity tariffs are mainly driven by generation costs, and therefore efficient generation is key to achieving affordable tariffs.”
He continued: “With ISO 9001: 2015 certification, you (UEGCL) will be expected to propagate culture of quality management within your work methods which in the end should translate into satisfied customers and affordable services.”
The purpose of the ISO 9001:2015 certifications is to challenge the agency to provide goods and services that consistently meet customer satisfaction and applicable statutory and regulatory requirements.

Armed with the certification, Ms Muloni said UEGCL should play a big role in ensuring affordable electricity for both domestic and industrial growth, especially once Karuma and Isimba are up and running in about two years’ time from now.
In his remarks during the launch of the ISO certification of the UEGCL, the generation company CEO, Eng. Harrison Mutikanga, said their emphasis will be in ensuring quality and affordability.
If they do not deliver on their targets with efficiency and quality that the certification warrants, Eng. Mutikanga, said their accreditation will be revoked.

Ms Muloni warned the agency against dropping the standard they pledged to uphold, saying there will be consequences.
Once Karuma Hydropower plant’s is completed, electricity will cost $0.0497 (Shs179.5) per unit for the first 10 years after commissioning.
The tariff will then drop from $0.0497 (Shs179.5) to $0.0297 (Shs97.5) during the 11th through the 15th year. From the 16th to the 38th year it will drop to $0.0117 (Shs42.2).

On the other hand, Isimba Hydropower plant’s generation tariff during the first 15 years will be $0.0416 (Shs150.2) and $0.0101 (Shs36.4) after the fifteenth year, according to documents seen by the Daily Monitor. These tariffs are what the Uganda Electricity Generation Company Limited (UEGCL) will charge the Uganda Electricity Transmission Company Limited (UETCL) for every unit.
End–user tariffs are arrived at by factoring in the reasonably incurred generation costs, transmission costs, distribution costs divided by the total number of units of power generated, multiplied by one, minus the target energy loss.
Karuma and Isimba, which will generate 600MW and 183MW are currently under construction.

Power tariffs
The government last approved the increment of power tariffs by 11 per cent in December 2016.
The increment saw households and kiosk owners pay Shs696.9, up from Shs623.6 for each unit above the first 15. In other words the rate for each of the first 15 units remains unchanged at Shs150.

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